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| Tuesday Dec 1, 2020 | |
| Using broad strokes the climate over North America has been above normal throughout the entire year with only brief glimpses of what it is like to have a below normal event. We are seeing a minor instance this week. Since the Thanksgiving holiday average temperatures have dropped by as much as 20 degrees throughout most of the Southeast, Gulf and Midwest. This is not polar in origin so the departures are only slightly below climatology. It is the first real taste of winter weather. Snow has also accumulated across the Ohio Valley. Figure 1 | WSI Temperature Map for December 1 Driven by the cool weather the ResCom demand across the country is moving up from 27 to 38 BCF per day. That is a very large increase but still keeps the Lower 48 heating load below ... » read more | |
| Monday Nov 30, 2020 | |
| While reviewing ancillary service prices in California in connection with some battery valuation work this week, I stumbled upon something odd. Here is a scatterplot of the clearing price for regulation up and regulation down ancillary services in CAISO, with each dot representing a single hour: Figure 1 – CAISO system-wide regulation clearing prices, 2019, hourly There may be something interesting to say about the relationship between the RegUp and RegDown prices, but what caught my eye is the unusual distribution of data points. There are no grid lines in the chart above, the vertical and horizontal lines are just formed by the density of observations along those pricing points. Scatter plots tend to form clouds, not grids. Since I just finished ordering supplies for a garden ... » read more | |
| Wednesday Nov 25, 2020 | |
| We continue to closely study battery math in various markets. In recent months EnergyGPS has done considerable amount of work on short-duration batteries in ERCOT and various flavors of batteries in CAISO including 2-hour to 8-hour duration batteries configured as stand-alone, paired with solar with AC coupling, and paired with solar with DC coupling. Each battery duration and configuration presents a wide range of valuation and contracting challenges. As anyone who has spent time looking at energy storage projects, the opportunity available in the real-time markets typically outstrips what is available in the day ahead markets. Let’s step through this a bit using data from the CAISO NP15. We selected this market because it has experienced fewer, game-changing price spikes than ... » read more | |
| Tuesday Nov 24, 2020 | |
| The record warm November has hit no region harder than the Marcellus. After ending the injection season at nearly full the DTI cavern had no ability to manage the loose balancing conditions from the loss of heating load. As a result the cash markets found themselves in two distinct incidences where they had to price off production in order to balance. Dominion South cash prices fell from $1.87 at the end of October down to 26 cents for the first week of the month. Production receipts fell by 2 BCF per day. But they are not out of the woods yet. Demnad has recovered from that event but the cavern complex remains at all time high inventory of 290 BCF. Figure 1 | DTI Storage for 2016 - 2020 As a result the December basis markets have been crushed over the past three weeks. December ... » read more | |
| Monday Nov 23, 2020 | |
| Recent changes in the jet stream has allowed more precipitation to move into the West Coast. In the past week a number of storms have battered the Cascades causing an early accumulation of snowpack. It is way too early to call an above normal snow year for the Pacific Northwest. We will reserve judgement for January. But the abundance has caused an early jump in the hydro output for the Mid Columbia market. Warm conditions are keeping run off high. Along with seasonal reservoir drafting it has swelled the river flows. Figure 1 | PNW Snow Fall Accumulations for 2019 - 2021 Since the beginning of the month the average daily hydro output has increased from 11.5 to 14.5 GWa. This is now 2 GWa higher than what was seen in 2019 and 2018. Up until this week, Seattle and ... » read more | |
| Friday Nov 20, 2020 | |
| This week CAISO a second--"Phase 2"--round of rule changes to accommodate “hybrid resources”—resources that combine storage with a variable renewable energy (VER) resource (typically, solar) at a common location. Like a cook scrambling to prepare a large meal for many guests, CAISO is gearing up to accommodate a wave of hybrid resources expected to interconnect over the next 3 years. Specifically, CAISO is expecting more than 1,500 megawatts (MW) of storage capacity expected to connect to the grid by the end of next year—much of that will be co-located with solar. Combined storage + solar capacity is a large part of the 3 GW capacity procurement target the CPUC adopted for IOUs and CCAS by summer of 2023. Hybrid resources a natural ... » read more | |
| Thursday Nov 19, 2020 | |
| The quote from the Wizard of Oz, "Toto, I have a feeling we are not in Kansas anymore.....", takes on many meanings but it is most commonly used in reference to someone not keeping up with the times, technology or education tools. It also takes on the meaning of being in a completely unfamiliar and/or discomfiting environment which is why we are discussing it in today's blog. Figure 1 | Wizard of Oz - Not in Kansas Anymore, Are we in California? If Dorothy and Toto were sitting in the chair staring at the computer screen as an analyst in the energy sector, they would be well aware of what has transpired within California over the years as their initiative to become the pioneer in the renewable space took form with the passing of the Renewable Portfolio Standard (RPS) back at ... » read more | |
| Wednesday Nov 18, 2020 | |
| Over the past two weeks, the upheavel across the United States tied to the election has been made for television drama. We started out with President Trump going to the podium in the early hours of Wednesday, November 4th claiming that victory was in site as the votes were being counted and the majority of the swing states were red in color. This meant that the the majority of votes counted at the time were for the President of the United States. It was not until later in the day that the television stations starting piecing the puzzle together that there was a substantial number of mail-in votes that still needed to be counted. As we have come to find out, each state is different when it comes to when they start to count the mail-in ballots and with the numbers much greater ... » read more | |
| Tuesday Nov 17, 2020 | |
| The abundance of storage is not limited to just the Lower 48. North of the border Canadian storage capacity is also at an all time high. Typically the increased HDD count in the norther latitudes ushers in a earlier draw down of inventory but not this year. COVID impacts and the warm start to November have limited the storage usage thus far. Coming into the winter season Alberta cavern operators knew the drawdown of capacity would have to include increased exports out of the province. All avenues into the Midcon, Pacific Northwest and Eastern Canada would have to be maximized. Starting on the first of the month, flows out of Empress onto TransCanada Pipeline increased from 2.8 to 3.3 BCF in an effort to supply premium priced markets. Figure 1 | Empress Flows onto TCPL ... » read more | |
| Monday Nov 16, 2020 | |
| If you watched the Sunday night football game where the New England Patriots hosted the Baltimore Ravens at Foxboro Stadium all you saw by the end of the game was a down pouring of rain where the players visibility was at most 10 yards and a referee that was explaining calls on the field in a crisp hurried voice as the wind and rain was pelting him in the face. From an energy perspective, the key to me was the fact that is was precipitation in the form of rainfall not snowflakes. Figure 1 | Patriots vs. Ravens Football Game - Plenty of Rain This illustrated how the weather model runs formulated their forecast over the weekend as temperatures in the Midwest, Ohio Valley and Northeast all took a turn to the warmer side of the equation. This quickly has dropped the prompt ... » read more | |
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